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Association of American Physicians and Surgeons, Inc.
A Voice for Private Physicians Since 1943
Omnia pro aegroto

Volume 58, No. 2 February 2002


The first stage of a rocket that might have let American patients escape the domain of the government/moneyed special interests ("public-private partnership") was aborted, singlehandedly, by Senate Majority Leader Tom Daschle just before Christmas. The first beneficiaries would have been families whose breadwinner lost employment-and thus medical insurance-after the September 11 attack on America.

The idea that individual patients/customers should choose and control their medical insurance and treatment is gaining strength: enough strength that a proposal to mitigate tax discrimination against self-owned insurance could have lifted off. However, this idea is so dangerous to their agenda that proponents of total government control of medicine forged new chains to tie it to the launching pad.

The method is basically the Filibuster. But nobody actually has to hold the floor and talk constantly as portrayed in Mr. Smith Goes to Washington. Rather, the Senate Majority Leader simply changed the rules so that any proposal he finds "controversial" requires a 60-vote majority to pass. That's how a one-vote lead in the Senate translates into iron control of the agenda, or effective single-party rule. (For details, see this month's Legislative Supplement.)

An aggregation of numerous weighty components exerts a powerful gravitational pull against the take-off of freedom in medicine, including: cultural Marxism; economic illiteracy; the politics of dependency; and politically favored interest groups.

Sen. Daschle can abuse power with impunity, states Paul Craig Roberts, because the media and the intellectual elite are controlled by cultural Marxists-who would hound from office any Republican using similar tactics (Wash Times 1/4/02). Their ideas are pervasive-especially in the younger generation. The statement that "When an economic function is turned over to the government, social cooperation invariably replaces self- interest as the motivation for human action" elicited incoherent Marxist dogma from half the students-after a semester of Public Choice theory demonstrating the contrary (IoL 4/00).

A Louis Harris survey conducted for the National Council on Economic Education showed that less than half of American students or adults understand the effects of price controls or the concept of scarcity. (Congressmen weren't tested.)

Tax breaks, of course, are not in the self-interest of the increasing proportion of the population, from high-salaried public "servants" to low-income workers to welfare recipients, that receives a net benefit from tax revenues.

The current third-party payment scheme-an insurance market it is not-developed from a convoluted series of government favors, such as HMO subsidies, the HMO Act that forced business to offer an HMO product, Medicare contracts, and barriers to market entry by upstarts. The Blues, according to Greg Scandlen, were "an absolute anti-trust violation (the hospitals joined together to create a monopoly payer which gave the same hospitals special treatment), that was allowed only through the `state action' doctrine." The result has been destruction of prices (as opposed to "charges" created out of hot air or Harvard or AMA RB- RVS computers), the key mechanism for information transfer in a free market. Moreover, insurance markets cannot plan long-term due to dependence on political winds-possibly accounting for the mass defection of reinsurers, on which small companies depend.

Managed-care abuses are legion, but "patients' rights" proposals would only make the situation worse. As Dr. George Fisher has pointed out, "Government administrative agencies fully understand that if they afford a large number of appeals mechanisms, they are creating the opportunity for determined opponents to bring the system down by deliberate use of every right afforded." While this could make managed care go away, it could also destroy indemnity insurance, to which recent proposals also apply. If courts refuse to recognize contractual exclusions, insurers will not be able to price risk.

The current scheme appears to be as entrenched as the buggy whip and Digital's status as the most successful computer company in history-until the horseless carriage and the PC and the Internet. Disruptive innovation could change the landscape very quickly. Though politicians favor the Hillary Care concept-a return to the 19th century hub-and-spokes arrangement with knowledge and power concentrated in the elite-patients, doctors, and businesses are increasingly taking matters into their own hands.

Non-network physicians could be found-and evaluated -by patients on the Internet. See nascent efforts such as www.myhealthscore.com (threatened with a lawsuit by the AMA for posting CPT codes and prices); www.indoc.com; www.simplecare.com ; and www.idny.org. Patients can also shop for insurance on-line, as at www.EHealthInsurance.com., 40% of whose customers were previously uninsured. Many are choosing short-term policies (one to three months)-much less expensive than COBRA coverage. Employers are shifting to defined contribution, with plans chosen by the employee (www.conning.com); various consumer-driven companies can expect an enrollment of about 500,000 employees in 2002.

Development of a true market is seriously hampered by the tax code: who can afford to give up the 40% subsidy for employer- owned insurance? Still, the truth is out there. Freedom is available. Patient-driven transactions can replace the game- theory driven environment in which hospitals and physicians have the same incentives as farmers who are paid not to grow wheat.

The question of the decade is this: can changes propelled by patient power reach escape velocity before Senator Daschle et al. manage to dismember and crush them?

How to Kill the Tax-Credit Idea

As George Fisher, M.D., points out, when you get tired of opposing something you dislike, you agree to adopt it, but only on condition that some crippling feature is included.

After 50 years of opposing the St. Lawrence Seaway, the railroads finally agreed to it, but only on condition that the locks at Messina would be so narrow that only eels could pass.

And you know what happened to MSAs.


Doctor Fights Health Dept. Information Grab

Writing to State Rep. Charles Gray, G. Keith Smith, M.D., of Oklahoma City explains that his opposition to the health department's attempt to grab private patient information for health studies is not about the security arrangments, but about lack of patient consent. "I don't care if the information is in Fort Knox, once it becomes digitized it will never be secure." The health commissioner admits that "if we ask for their consent to release this information, we won't get it."

"Numerous historical precedents exist wherein medical personnel and facilities have become agents of the state rather than their patients. The most famous was about 60 years ago in Berlin. Much was said then about subordinating the interests of the individual for the good of the whole or the many."


Emergency Powers Act Causing Outrage

Civil libertarians, Constitutionalists, and privacy advocates are joining together to do battle against the proposed Model State Emergency Health Powers Act, MEHPA (see AAPS News Jan. 2002). Although he had quickly endorsed the proposal in a press release, HHS Secretary Thompson, in a Dec. 14 letter to Steve McDaniel of the American Legislative Exchange Council, now states that the draft bill prepared by Lawrence Gostin "represents neither an official nor unofficial position by HHS, CDC, or this Administration," and denies any effort to dictate to the States.

The Dec. 21 draft posted at www.publichealthlaw.net deletes the mention of firearms (though not the power to seize them) and also removes the criminalization of patients' refusal to be vaccinated or doctors' refusal to serve the State. However, doctors could be permanently delicensed for failure to cooperate. In an AAPS analysis posted at www.aapsonline.org , Executive Director Jane Orient, M.D., notes the minor improvements but calls the draft "a disingenuous effort to mute criticism while making little substantial change."

In a point/counterpoint symposium, Gostin writes that "private property is worth protecting" (a decidedly tepid view of a basic human right), but emphasizes the "common good." AAPS Immediate Past President Robert J. Cihak, M.D., and Michael Glueck, M.D., respond: "endowing state governments with such power could result in fear and terror more pervasive than possible from any terrorist attack" (Insight 1/7/02).

One-man rule, and a "small dose of tyranny" are more like a prescription for disaster than the best cure for terrorism, concludes Jonathan Turley (Jewish World Review 1/7/02). He states that in true emergency, the governor already has all the authority he needs, within the framework of legislative and judicial oversight. It is "unchecked authority that is the dubious contribution of the Model Act." And, most astonishingly, "triggering of this absolute authority is left entirely to the discretion of each governor."


Doctor Opposes AAFP "Universal Coverage" Plan

Dr. Glenn P. Dewberry, M.D., of Oklahoma City wrote a letter to 100 family physicians to explain why he was dropping out of the AAFP: The "universal coverage" plan being pushed by AAFP would open the door to government-controlled medicine, he said. Many delegates at the 2001 Atlanta meeting objected to the plan; the vote was so close that three separate head counts were needed. The final tally was 59% for, 41% against. "This does not mean that 59% of members (as opposed to delegates) support the plan and hardly shows the `overwhelming support' that AAFP has claimed."

"My resolution failed [see below], in part because President-Elect James Martin, M.D., said the plan would be put `on the shelf.' But if the report does not bind the AAFP to a specific course of action, why has the AAFP spent so much time and money supporting it? It seems that AAFP leaders feel so strongly about adopting a government-controlled system that they don't care if nearly half the members disagree with them."

The "AAFP has been used to provide a 30-second sound bite for proponents of government medicine. I do not think that is a valid purpose for the AAFP and decided not to send $600/year to support it; I can keep track of my own CME. I believe that if 50% of the members decided to drop out that would attract attention leading to real progress `in the debate'."


Model Resolutions

(full text at www.aapsonline.org)

"Universal Coverage": Okla. Academy of Family Physicians RESOLVED: that the OAFP does not support the strategy of achieving universal health coverage through a government agency that would have the authority to determine a benefits package, set reimbursement rates, and perform the regulatory duties of overseeing the program... and that the OAFP does not support the strategy of achieving universal coverage by implementing a payroll tax.
by Glenn Dewberry, M.D.


Unique Medical Identifiers: California Medical Association

RESOLVED: that the California Medical Association actively oppose the use of any patient identifying number, including the Social Security number, which might permit unfettered access by the government or other entities to confidential patient information...
by Susan Hansen, M.D.


Patient-Friendly Financing: California Medical Association

RESOLVED: That the CMA study, design, support and endorse only innovative, consumer-driven and controlled health care financing programs, such as MSAs linked to high-deductible, unmanaged insurance, and defined-contribution employer programs....
by Thomas LaGrelius, M.D.

Doctors, Patients Harmed by Privacy Regs

In response to the government's assertion in AAPS et al. v. HHS that any harm from the Privacy Rule is a mere hypothetical, a number of AAPS members have come forward to file affidavits attesting to the costs and other harmful effects they are already experiencing. Additionally, patient plaintiff Dawn Richardson declares that not only have her communications with physicians been chilled, but her access to medical care for her children is significantly reduced.

"Now that government has access to patient records, physicians have already expressed to me and members of PROVE [Parents Requesting Open Vaccine Education] that they will no longer care for children who have not been fully vaccinated in compliance with all government vaccine recommendations and mandates because they fear penalty."

Mrs. Richardson also testified to personal involvement with parents who had been threatened with seizure of their children because of lawful decisions to decline a controversial vaccine. "The Privacy Rule discourages patients ... from providing medical history ... that can be used against them."

Among the arguments in a 50-page memorandum responding to the government's Motion to Dismiss, AAPS points out that the Defendant actually left out the last four words in quoting the Tenth Amendment-"or to the people"- attempting to deny that "the Constitution divides authority between federal and state governments for the protection of individuals," as "State sovereignty is not just an end in itself" (Coleman v. Thompson, Blackmun dissenting).

The HHS claim that the narrow delegation of authority to regulate electronic records constitutes nearly unlimited authority to regulate all medical information "is akin to the Federal Communications Commission (FCC) claiming that because it can regulate interstate phone calls, it can also regulate other activities of persons if they ever make an interstate phone call."

AAPS requests discovery on a number of points: the ratio of paper to electronic records; the accuracy of the HHS allegation that "an overwhelmingly large number of commenters" urged the expansion of regulation to all records; the facts relevant to claiming an exemption from the Paperwork Reduction Act; and the actual steps the agency took to minimize the impact on small entities as required by the Regulatory Flexibility Act. The mere fact that an outside consultant was retained is not enough.

A hearing was held in Houston on Jan. 4.

Litigation is being funded by the American Health Legal Foundation; contributions are tax-deductible.


Tainted Claims Case Dismissed

In U.S. ex rel. v. Mikes, the Second Circuit dismissed a False Claims Act qui tam complaint against three oncologists. On the "tainted claims" theory (see AAPS News Dec. 2001), the doctors were not entitled to $28,922 in payment for spirometry because they did not follow American Thoracic Society guidelines for daily calibration of the spirometer.

The Court ruled that a claim can only be "false" if the physician falsely certifies compliance with a law or rule that is a condition for government payment. In an amicus brief, the government argued that claims for substandard tests were false claims for worthless services. However, the Court found no evidence that the doctors had knowingly submitted claims for worthless services.

"While this case is a victory for physicians nationwide," writes attorney Amy Woodhall of Cleveland, OH, who consults for the AAPS LLCS, "keep in mind that the court awarded the physicians only $5,000 of their $437,000 attorneys' fee. Further, the physicians' arguments on appeal were supported in briefs by a coalition of medical societies."


Tip of the Month: The process of selecting a jury, the "voir dire," is perhaps the most important part of a trial. A defendant-physician should never waive his right to it. He can typically remove up to ten potential jurors without giving a reason. Bureaucrats should probably be excused. Also, jurors at the two ends of the political spectrum are probably better for a defendant than those in the middle.


Courts Weigh Abortion-Breast Cancer Link

In what is probably the first such settlement in history, an Australian woman settled with an abortionist she had sued for failing to inform her of research linking abortion with an increased risk of breast cancer. The amount was undisclosed.

Abortionists, as a rule, do not inform patients that 27 out of 35 relevant studies published since 1957 have linked abortion with breast cancer (WorldNetDaily 12/30/01).

In North Dakota, the Red River Women's Clinic is being sued for false advertising by abortion protester Amy Jo Mattson, on the basis of promotional material stating that "none of [the claims about a link between abortion and breast cancer] are supported by medical research or established medical organizations." Her attorney, John Kindley, authored a 1998 article on informed consent laws and the ABC link.

After an extensive review of the scientific evidence and the legal methodology, as for establishing decision causation, Kindley concludes: "Abortion providers' continuing failure to inform patients about the steadily accumulating evidence of the ABC [abortion-breast cancer] link can ... be considered a trespass ... against the patient's `right to determine what shall ... be done with [her] own body' " ( www.johnkindley.com/wisconsinlawreview.htm).

Attorney Scott Somerville compares the case to tobacco lawsuits. People continue to smoke, and will continue to have abortions, but there are tremendous financial consequences for the industry. The ND Century Code, for example, provides $10,000 and triple the amount in actual damages to women who were not provided with enough information to grant "informed consent" for an abortion (WorldNetDaily 8/26/00).


TAP Pharmaceuticals Gagged

For marketing tactics such as charging doctors less than the "wholesale" price of Lupron, TAP settled for $845 million, paid a $290 million criminal fine, and is on probation for 5 years. Moreover, it is forbidden to criticize the sentence or to say that the plea was for convenience (BNA's HCFR 12/12/01).


AAPS Calendar

Feb. 9. Board of Directors meeting, Dallas, TX.
May 17. Board of Directors meeting, Las Vegas, NV.
May 18. Spring meeting, Las Vegas, NV (to be confirmed)
Sept. 18-21. 59th annual meeting, Tucson, AZ.
Sept. 24-27, 2003. 60th annual mtg, Point Clear, AL


Sickest Hurt Most. Recent Medicare fee cuts are disproportionately higher for the higher levels of service. As a corollary, within the past two years Medicare instituted a "site- of-service reduction," paying an additional 5% less for Critical Care Services (CPT codes 99291 and 99292) because they are provided in a hospital. Of course, critical care services are virtually always provided in a hospital. This reduction is also applied to lumbar punctures. Through this substantial disincentive for physicians to care for sicker patients, the government discriminates against the sickest of the sick.

As a result of Medicare price controls that fix many of our fees below the cost of providing service, and in the face of escalating costs incurred in dealing with the incompetent and abusive HCFA/CMS bureaucracy, our office has been forced to restrict services provided to Medicare "beneficiaries." Although our goal is to serve everyone in need, we cannot both provide and pay for services that Medicare patients need. We will also need to restrict further the number of Medicare patients that we accept in order to control the financial losses we suffer due to treating these trapped government dependents. The government has made seniors second-class citizens, subject to price controls on the order of 10 cents on the dollar, who can neither obtain medical care under the system nor escape from the government's control by purchasing their own care.
Lawrence R. Huntoon, M.D., Ph.D., Jamestown, NY


Accept Medicare, or Else. Citizens who reject Medicare Part A cannot receive Social Security benefits, and must return any payments they have already received. I am glad that someone besides me-Sue Blevins in her new book Medicare's Midlife Crisis-has taken note of this policy. I find it quite surprising that there has been virtually no public discussion about this.
Beverly Woodward, Ph.D., Waltham, MA


The AMA and HIPAA. Last session, the AMA passed an endorsement of the privacy regulations; opponents didn't think it was worth being politically incorrect. This session, the people who will have to obey this trash are suddenly aware of the egregious extent of it, and are mad as hell. It will be fun to see the circumlocutions, since the AMA is like the Supreme Court, pretending never to reverse itself. But you can be sure it will reverse in fact, if not in words.
George Fisher, M.D., Philadelphia, PA


Two Tiers in Canada. Powerful politicians are suggesting that we will have to partially re-privatize our medical system, or at least allow private purchase of care by individuals, i.e. a two-tier setup such as has existed in Britain since 1948. This would be a giant leap forward, allowing a yardstick for comparison with the public system. Politicians have not suddenly acquired common sense; they finally see that the system is financially untenable, no matter how many tax dollars they throw at it.
William Goodman, M.D., Toronto, Ontario


Drug Price Controls. In British Columbia, 27% of physicians reported admitting patients to the emergency room or hospital as a result of switching medicines, as mandated by the government reference price system. Patient confusion about switching cardiac or hypertension drugs was reported by 68% of physicians, and worsening of symptoms by 60%.
Ernest J. White, Alexandria, VA


Who Will Answer? When the lefties attack me by hate e- mail, ranting that I don't care about the downtrodden, I calmly ask them how much I should have to pay in taxes above the 40% that already goes to government. It shuts them right up. Not one of about 50 leftist readers, editors, or journalists has answered that question.
Craig Cantoni, Scottsdale, AZ


A Pledge. I pledge allegiance to the Constitution of the united States of America, and to the Republic which it defines, a nation of independent states under God, ensuring liberty and justice to all.
Charles Heller, Tucson, AZ


Independence Is Wonderful. I watch with sadness so many of our group knocking their heads against the wall of the third party payment problem. If one is willing to pull in one's belt (financially), one will find that it is a joy to practice medicine without any third party being involved. Of course you are going to treat a lot of those Medicare and HMO patients at a reduced rate, but I have been pleasantly surprised at how responsible most will become (after some understandable initial grousing). Come on in; the water's fine!
Philip Catalano, M.D., Bradenton, FL


Children Need Supervision. If physicians can't be trusted in the financial sense, it's because they don't deal with patients on financial matters. The whole process by which physicians deal with third parties relegates consumers/patients to the responsibility status of children, who must of course be protected.
Frank Timmins, HealthBenefitsReform group


What Does "Single Payer Mean"? Is it a euphemism for total government takeover, or are "liberals" suddenly enthusiastic about a corporate monopoly?
James Pendleton, M.D., Bryn Athyn, PA

Legislative Alert

It's the Structure, Stupid!

You would not know it from most of the press accounts. But the recent Congressional debate just before Christmas over the medical insurance problems of laid-off workers was perhaps the most momentous collision on health policy since the collapse of the Clinton Plan in 1994. High stakes.

Why? Because the central issues were clearly and openly joined: Who is going to control the flow of money in the system? And who is going to make the key decision over the choice of plans, benefits, and medical treatments and procedures? The central issue was not money or numbers of people covered, but rather structure and control. This discrete and bitter battle was yet another proxy fight between those who want government-run medicine and those who want a free market. But this round was different.

The nastiness was in many respects a continuing debate over the limitations of employment-based medical insurance. Those who work for a big organization and have a big income have access to a big medical benefits package, usually more than one, and in effect a big chunk of tax-free income to boot, roughly equal to 40% of the cost of the package. Those who are poor and work for a small firm without a company-based plan get no tax break at all. Likewise, the unemployed get nothing. In the waning days of 2001, President Bush and his allies in Congress attempted to change this.

Parliamentary Politics

At 4:00 a.m. on Dec. 20, the House of Representatives, with the backing of the Administration in the aftermath of brokering a crucial agreement between the White House and leading Senate "centrists," voted to pass a $110 billion economic stimulus bill. That bill included $13 billion in refundable tax credits for those who had lost their insurance coverage. Individuals and families would get a refundable credit of 60% of the cost of private insurance premiums. The tax credit would be available for a period of two years. The vote was 224 to 193.

In the Senate, the Administration and its Congressional allies were certain they could get a bipartisan majority of at least 53 votes to enact the bill. But Senator Majority Leader Thomas Daschle (D-SD) refused to allow a vote. Earlier in the protracted discussions on the fate of economic stimulus package, Sen. Daschle had erected another procedural hurdle: any compromise agreement package would have to pass the muster of two-thirds of the Senate Democratic caucus. This meant that the influential Senate leftists who specialize in health policy, including Kennedy (D-MA), Clinton (D-NY), and Rockefeller (D-WV), would get the equivalent of a veto over the terms of the final legislation. To overcome Sen. Daschle's firm opposition, the Senate sponsors of the House-passed bill would have had to secure 60 votes to achieve "cloture" and bring the bill to the floor, a task that was simply out of reach. On the afternoon of Dec. 20, Senate Minority Leader Trent Lott (R-MS) sought "unanimous consent" to bring up the House-passed stimulus package for debate and a vote. Sen. Daschle objected, then immediately offered, under unanimous consent, a 13-week extension of unemployment benefits. Lott objected. The stimulus debate ended.

The Evolution of the Policy

Shortly after the Sept. 11 terrorist attacks, Senator Jean Carnahan (D-MO) proposed a major program to aid the unemployed: generous subsidies to those eligible for a an 18- month continuation of medical insurance through their former employer's plan under the terms of the Consolidated Omnibus Reconciliation Act of 1986 (COBRA), plus a major expansion of Medicaid. Kennedy then proposed a more robust, multi-billion dollar version. Eventually, the Democrats' proposal crystallized into a 75% subsidy for COBRA coverage for those eligible, plus Medicaid expansion for those not. Clearly, Senate leftists intended to seize this opportunity to secure a major expansion of Medicaid-a first tier of nationalized insurance.

Republicans, au naturel, at first responded to the Left's major initiative with precisely Nothing, waiting for the White House to take the lead. President Bush originally proposed a vague $3 billion block grant to the states. The Left never saw this as any kind of threat because the bulk transfer of federal monies to state governments-in reality state bureaucracies- for medical care usually means an expansion of Medicaid. Nor was the small amount ever a serious issue; Congress can add funding any time. Remember: structure and control.

Senator Jim Jeffords (I-VT) proposed to address COBRA coverage with a new system of tax credits, building upon a previous bipartisan proposal. Jeffords's general approach in favor of individual tax relief for the purchase of medical insurance was shared with others, notably Senators Bill Frist (R- TN), Rick Santorum (R-PA), and John Breaux (D-LA), the acknowledged head of the Senate "centrists." The problem with restricting tax relief to COBRA coverage is that COBRA coverage is invariably expensive because eligible persons were in big corporate plans. Breaux had a better idea. If tax credits were good enough for the expensive COBRA coverage, why not simply allow people to use tax credits for any other type of private medical insurance, including more affordable coverage outside of COBRA? This was a fundamental break with more than 60 years of entrenched federal policy. Breaux and his Senate allies, including Jeffords, backed the provision of individual tax relief for the purchase of private medical insurance outside of the workplace. Individuals, in other words, would choose their plans, not employers, and they alone would control the flow of the money. Not employers, not Medicaid. Once again, remember, structure and control.

Medicaid for the Masses?

Talks between House and Senate staff over the fine points of the stimulus package went nowhere throughout most of December. Remarkably, Democratic negotiators "reportedly sought to provide incentives to states to expand Medicaid coverage to people up to 400% of poverty" (White House Bulletin 12/14/01). Based on 2000 Census Bureau estimates, for a single person that would mean an income of almost $36,000 per year; for a two-person family, more than $44,000; and for a four-person family, more than $68,000. These new eligibility standards would cast the Medicaid net over millions of persons: a wild proposition-except among those whose overriding goal is to secure government control over the financing and delivery of American medicine.

The White House Breakthrough

Meanwhile, Rep. Bill Thomas (R-CA), chairman of the House Ways and Means Committee, proposed a broader tax credit, worth roughly $10 to 13 billion in additional outlays and forgone revenues, that could be used by unemployed persons for any type of private medical insurance coverage. Thomas sided with the Senate centrists on the undesirability of restricting tax relief for COBRA coverage and promoting a massive expansion of financially troubled Medicaid. The White House had achieved a breakthrough, coming to an understanding with Breaux and Senate "centrists" on the whole economic package, accelerated tax cuts and investment stimulation, as well as a new medical insurance tax credit equal to 50% of the premium, up to $294 per month for family coverage. Shortly thereafter, the medical insurance credit was increased to 60%.

The Lessons of the Stimulus Debate

1. Congressional Republicans discovered the truth that the health care policy debate is not about money; it's about the structure of reform. The Left has always understood that. The Bush team and its Congressional allies went from a vague block grant proposal, totaling $3 billion, to a $13 billion package of tax credits, and were willing to go higher, but Democratic leaders were simply not interested. The reason: "In the view of many Democrats, Republicans may have moved left on some tax issues, but actually headed further right on health insurance. That is because under the GOP plan, the credit would be given to individuals to seek out their own insurance, paying 60 percent of the cost, while Democrats wanted a more generous credit to work through the current employer based health care system" (Wash Post 12/20/01, emphasis added). Additionally, "Democrats view this plan as laying the groundwork for the administration's goal of health insurance tax credits for all Americans" (Wash Post 12/17/01). The Left gets it. When Democrats push for an expansion of SCHIP or Medicaid, or Medicare prescription drug coverage through the Medicare bureaucracy, too often Republicans don't. Now they might.

2. The Left needs to abort personal choice of plans and benefits, and make sure the medical insurance system largely stays the way it is in order to facilitate a transition to a government-controlled system. In a real market, millions of people make decisions every minute, and there are millions- no, billions-of decision points in market transactions. Those dynamics are impossible to monitor, let alone control. In the employment-based system, there is one key decision point: the contract between the employer and the insurance company. That point is neatly defined and that transaction is easy to regulate and control. Look at mandates and employer-based insurance regulations, rules, and guidelines at the federal at state levels. This is why, although Democratic leaders indicated that they would accept a medical insurance tax credit, "they are pushing instead for higher payment-up to 75% of premiums - and want it available instead to the insurance companies or employers of workers who qualify for a federal plan that lets people keep company provided health insurance after they lose their jobs" (Wash Post 12/17/01, emphasis added.)

3. Congressional Republicans, aided by the political skills of the Bush White House, found themselves for the very first time in memory playing offense on health-related policy. By putting together an attractive proposal broadening personal choice, the White House and its allies forced the Congressional Left into a defensive mode, requiring them to resort to parliamentary maneuvers such as silly internal partisan caucus agreements and blocking motions. That should require a lot of explaining to a befuddled public. Moreover, the Congressional Left, like its allies in various think tanks, really wants to expand Medicaid, notorious for substandard care, though Americans would probably not accept this poorly performing welfare program over private insurance if they got the choice. The Left, therefore, has been forced to remove any real choice, and defend a politically weakened position with transparently incredible excuses. Nobody with two neurons firing really believes that Senate champions of national health insurance really, deep down want to preserve private employer-based medical insurance because that would be the best of all policy worlds. No; they want to replace it with national health insurance, while expanding Medicaid in the process. The question now is whether the President and his allies on Capitol Hill can fully capitalize on their newly found position on the high ground in the debate and aggressively press their political and public relations agenda. They have a golden opportunity.

The "Choice Wars"

Go to any academic or professional health care policy conference, and you will clearly see that "Conservatives" and "Moderates"-if they are invited, a big if-are forming a coalition for personal choice and competition within the framework of a voluntary, private market. Left-wing policy analysts often don't like "choice" in health care, or in education, or in pension policy, or a lot of other areas of life, with, of course, the sacrosanct exception of abortion which, after all, is OK under any or all circumstances. (Being "judgmental" in that matter is not only "bad" in some vague way, well, it's also "inappropriate" and utterly lower-middle class, and all that.) But policy conferences have been more closely examining the issue of "choice" in medical care. Is choice really necessary? (Not really.) When is or isn't choice "appropriate" in a "market"? (Almost never.) Isn't "choice" only important when it comes to doctors? (Yes, and the health plan that engages doctors could just as well be national and run so much more efficiently by the government.) Does choice lead to "desirable" outcomes? (Of course not!) Do ordinary people have the sufficiency of knowledge or intelligence to make intelligent choices? (You kidding?) How can we "regulate" choice to make sure that choice is the right choice? (You get the choice we superior people give you.) What are the "implications" of choice (Not Good). How can you have choice without adverse selection in the health insurance market? (You can't: therefore, this annoying choice thing has simply got to go.)

Fortunately, the President and his allies in Congress don't have to score points at academic conferences. All they have to do is to persuade the American people, who remain, thank God, the national repository of common sense.

Robert Moffit is a prominent Washington health policy analyst and Director of Domestic Policy at the Heritage Foundation.